Riyadh: Saudi Arabia's cement production is expected to increase 19 per cent to an estimated 50 million tonnes this year, thanks to a construction boom in the kingdom. The lifting of an export ban on the product last year has also helped the industry.
The domestic demand for cement increased from 30 million tonnes in 2008 to 35 million tonnes in 2009, according to an industry source. At the same time, cement companies reported a 9.8 per cent drop in net profits in 2009.
The net profits of eight listed companies totalled approximately 3.6 billion Saudi riyals (Dh3.5 billion) during 2009 compared with 4 billion riyals the previous year.
According to performance results, almost all the companies except Qassim Cement suffered a decline in net profit last year.
Qassim Cement recorded an increase of 17.65 per cent to 607.9 million riyals against 516.7 million riyals the previous year.
Arabian Cement posted the largest fall of 47 per cent in 2009 to 171.9 million riyals from 324.2 million riyals in 2008.
Five companies posted increases in the last quarter of 2009 against the same period of the previous year.
Tabuk Cement led this group with a record net profit of 25.5 million riyals, a 190 per cent increase over the 8.8 million riyals in the same period in 2008. However, the company's net profit suffered an annual decline of 20 per cent in 2009. Tabuk Cement was followed by Qassim Cement with a 96.98 per cent increase to 179.4 million riyals from 91.1 million riyals.
There was a decline of about 33 per cent for Eastern Cement and Yanbu Cement in the last quarter of 2009.
Eastern Cement's profit fell to 50 million riyals from 75 million riyals and that of Yanbu Cement dropped to 79.8 million riyals from 120.2 million riyals.
However, two companies showed positive results in the last quarter of 2009. Saudi Cement, the country's second-largest producer, said its fourth-quarter profit rose.
Saudi Cement's profit was 145.5 million riyals compared to 131.7 million riyals in the same period the previous year.
Saudi Cement's profits for full year 2009 fell 5.3 per cent to 588 million riyals and its earnings per share fell to 5.77 riyals from 6.09 riyals the year earlier.
Southern Cement, the kingdom's largest cement maker by market value, made a net profit of $48.27 million (180.56 million riyals) in the three months to end December, up from 177 million riyals in the same period a year earlier.
